Mitchells and Butlers, the pub group, ­yesterday blocked a radical overhaul of its board in a move that could push the company into a showdown with its largest shareholder.

Chairman Simon Laffin and the rest of the board told shareholders they should oppose the appointment of two directors proposed by shareholder Joe Lewis, the Bahamas-based billionaire currency investor who owns 23% of the business.

The move follows more than a year of rows between the board and Lewis's investment vehicle Piedmont. Last year, a series of confrontations resulted in accusations that Lewis acted in concert with Elpida, a 17.5% shareholder, which is owned by Irish businessmen and ­racehorse owners JP McManus and John Magnier. Shareholders will be able to vote on the appointments at the company's annual general meeting on 28 January.

M&B, which owns the All Bar One and Harvester chains and employs 42,000 staff, alleged that Piedmont representatives made it clear they could marshall a majority of votes in the event of a referendum on the board. A decision by the Takeover Panel on whether Piedmont and Elpida colluded is expected in the next few weeks.

Piedmont put forward proposals before Christmas for four new directors, including Simon Burke, the Majestic Wine boss. It called on shareholders to reject ­re-election of Drummond Hall, the firm's former chairman who is standing again as an independent director.

M&B said Piedmont indicated informally that it also wanted Laffin to be stripped of the chairmanship and replaced by John Lovering, who would join as a new director. Lovering, a private equity specialist, is currently chairman of Debenhams. Intense negotiations with Piedmont over the past month failed to reconcile the two sides, said Laffin.

He said: "It is not clear to us what Piedmont want apart from control of the board and the chairmanship. The current board ... are leading the business to continue to deliver strong performance as demonstrated last week."

Lewis is highly critical of the M&B board, which he claims is largely unreconstructed since it lost more than £400m in a failed currency hedge two years ago. A source close to Piedmont said the board had failed to show "due account for past mistakes".